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DRAFTING GROUP A

TRADE, ENVIRONMENT AND SUSTAINABLE DEVELOPMENT: In the general discussion of Chapter 2, Norway highlighted the need for green buying policies, green liability rules and full access to environmental product information. Brazil noted the importance of trade liberalization in promoting an environmentally- supportive international economic system. The US defended the role of trade policies in pursuing environmental objectives. Morocco said environmental concerns should not serve as a pretext for hindering developing countries' access to markets. Malaysia stressed improved market access and expressed concern about environmental conditionalities that restrict trade.

The issues that arose during the negotiations included: the use of trade measures in environmental agreements; sustained economic growth; 'integrated' dispute settlement; life-cycle approaches; 'discouraging' unilateral actions outside international trade rules; least trade-restrictive environmental policies; and internalization of environmental costs.

The final decision notes that: trade and environmental policies should be mutually supportive in promoting sustainable development; the needs of developing countries should be taken into account; and there is a need for capacity-building in developing countries and countries with economies in transition. It also notes: issues related to the links between trade, environment and sustainable development; cooperation to promote an international economic system that will lead to economic growth and sustainable development and address environmental degradation; the Uruguay Round Agreements; the work of the WTO's Committee on Trade and the Environment; access to markets; transfer of environmentally sound technology (EST); finance for small firms; environmental regulations and standards; the need to analyze impacts of product- specific policies; consumer preference for 'environmentally friendly' products; progress achieved through relevant international organizations; preparation of a paper reviewing research on trade, environment and sustainable development links; studies on the relation between environmental protection, job creation and development; avoiding adverse effects of product specific policies; eco-labeling and recycling; technical assistance to developing countries and countries with economies in transition; assessment of the environmental effects of trade policies; coordination between environment and trade policies; implementation of trade and development principles in accordance with Agenda 21; and the importance of transparency, openness and public participation in work on trade and the environment.

COMBATING POVERTY: In the negotiations of the Chair's draft decision on Chapter 3, the G-77/China tended to replace references to poverty 'reduction' with poverty 'eradication.' Other points of discussion included references to: the Covenant on Economic, Social and Cultural Rights and the Declaration on the Right to Development; private sector accountability; and 'women as the majority of people living in poverty.'

The final decision notes: the complexity of the link between sustainable development and poverty eradication; the importance of economic growth in combating poverty; the need for an integrated approach to poverty eradication; the need for programmes focusing on women, children and youth; relevant international instruments and declarations; and the rights of people living in poverty. The Commission also notes: the need for a favorable international economic environment, including financial and technical assistance flows, better terms of trade and access to markets, debt relief, and transfer of EST; public accountability of private business; implementation of agreed commitments; cooperation and synergy between the CSD and other commissions concerned with poverty eradication; and links between programmes aimed at poverty eradication and sustainable development.

CHANGING PRODUCTION AND CONSUMPTION PATTERNS: In the general discussion of Chapter 4, the EU noted that developed countries have a special responsibility to reduce unsustainable production and consumption patterns. Australia, Bulgaria and Algeria highlighted the CSD's role in consumption issues. Consumers International Environment said that projected energy increases highlight the responsibility of developed countries to address consumption and production patterns.

In the negotiations of the Chair's draft decision, references to the gaps between and the responsibilities of developed and developing countries, the life-cycle approach, procurement policies in developing countries, ecological tax reform, and eco-labeling generated discussion.

The final decision (E/CN.17/1995/L.12) notes that: unsustainable patterns of consumption and production are the major cause of environmental deterioration; there are common but differentiated responsibilities in this field; and developed countries have agreed to take the lead by promoting change in their own countries. It also notes: the results of the Oslo Roundtable; the imbalances between developed and developing countries; measures to reduce production and consumption; the need for long-term studies; internalization of environmental costs through the polluter-pays principle and the introduction of economic measures; natural resource accounting; international cooperation for setting product standards; and the exchange of experience on all levels. The Commission's future work programme will include: identifying policy implications of projected trends in consumption and production patterns; assessing the impact of changes in developed countries on developing countries; evaluating the effectiveness of policy measures intended to change production and consumption patterns; eliciting time-bound commitments from countries; and revising guidelines for consumer protection.

DEMOGRAPHIC DYNAMICS AND SUSTAINABILITY: There was little general discussion of Chapter 5, and in the negotiations most of the discussion focused on language rather than substance. References to health, education technology, empowering women, populations at risk, and cooperation between the CSD and the Commission on Population and Development were added.

The final decision also notes: the need to study the links between poverty, health, education, technology, patterns of production and consumption, development and the environment; the ICPD Programme of Action and the additional resources necessary to implement it; the integration of population issues into sustainable development planning; populations at risk from environmental degradation; the links between development, environmental protection and the empowerment of women; and NGO contributions.

FINANCIAL RESOURCES AND MECHANISMS: The consideration on Chapter 33 began with a panel discussion, and there was also a report on the intersessional Ad Hoc Working Group on Finance. Many countries expressed concern about declining ODA levels. Colombia said that the question of external debt should be seen as an opportunity to free resources for sustainable development. Norway called for green tax reform and increased use of economic instruments, and noted that although private investment flows are at a high level they are unequal in a regional sense. Ecuador expressed concern about the detrimental impact of financing on the environment and the social and environmental dimensions of sustainability.

The G-77/China said that the debate should focus on: increasing ODA; a solution to the debt problem; and direct foreign investment. Malaysia called for an increase in ODA levels, innovative financial mechanisms, and assessment of the effectiveness of the policy instruments in the Matrix. Algeria said that: new and additional financial resources must be mobilized; the debt problem must be resolved; and the issue of economic issues should be left to governments. Brazil said that private capital flows are essential, but should not replace ODA. The Philippines recommended studying the feasibility of adopting economic instruments and urged developed countries to encourage private sector investment in developing countries.

In the negotiations, topics that generated discussion included: the decline of ODA in absolute terms; the 0.7% ODA target; reform measures in recipient countries; international safety nets to address negative effects of private capital outflow for developing countries; debt-for-equity swaps; GEF replenishment; efforts to direct national action; environmental taxes; economic instruments; application of innovative mechanisms; intellectual property rights; sustainable development indicators; a user charge on air transport; and EST rights banks.

The final decision (E/CN.17/1995/L.11) calls for: increased ODA for developing countries and more effective use of ODA; private capital flows and investment; debt- relief measures; expanding the mandate of international financial institutions to include sustainability; development of sustainable development indicators; mobilization of domestic financial resources; economic instruments that take national conditions into account; and support from governments and international organizations for strengthening national capacities in the use of economic instruments. The decision also notes: the Intersessional Ad Hoc Open-Ended Working Group on Finance's consideration of innovative measures; internationally tradeable CO2 permits; the consideration of national needs and IPRs in ESTs and biotechnology transfer financing; further study of the Matrix approach; the principle of common but differentiated responsibilities; and the use of national experience as case studies.

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